Liontrust's Phillips: Duration increase has made bonds more risky

Fuelled by loose monetary policy, fixed income managers have had a tailwind for the past ten years.

This tailwind is changing and managers are going to have to dig more into our own reserves to provide value for our clients. Loose monetary policy has also increased bond market risk as duration has nearly doubled in the past ten years. We believe investors in fixed income should employ a flexible approach based on the limited pockets of value that we see in the overall asset class.   Among an expensive bunch, our favourite government bonds tend to be US dollar-denominated. The US central bank has at least managed to raise interest rates to a level that is closer to a fair value th...